Drowning Bitcoin Pulls Crypto Stocks into Deep Water

Crypto stocks are in flux since Bitcoin (BTC) was rejected by its 200-day moving average and slowly staggered dangerously close to $60,000. That sector weakness has Strategy (NASDAQ:MSTR) and Coinbase (NASDAQ:COIN) on investors' radar.

MSTR was last seen trading flat near two-month lows hit yesterday, with $120 potential support going forward. The stock carries five losses out of last six sessions on top of its 66% 12-month deficit.

For COIN, support at $160 is keeping losses in check today. That same level captured the stock's late-March pullback, though year-to-date, Coinbase has shed 28%.

Beyond their weak technical backdrops, the broader cryptocurrency sector is heavily shorted. Roughly 12% of MSTR's and COIN's' total available floats, respectively, are sold short.

Options traders are in luck, as MSTR's and COIN's Schaeffer's Volatility Scorecard (SVS) sitting at 78 and 96 out of 100, respectably, indicating these stocks have tended to exceed option traders' volatility expectations during the past year.